EU crisis to have mixed impact on exports: analysts

Staff Writer, with CNA

European demand for Taiwanese-branded notebook computers and smartphones will remain stable this year despite the region’s sovereign debt crisis, but demand for Taiwanese solar products will falter, a Taipei-based market researcher said.

Topology Research Institute (拓璞產業研究所) vice president Simon Yang (楊勝帆) predicted that consumer demand would be more stable than the government subsidies needed for solar product sales to thrive.

“The smart terminal market [smartphones and notebooks] looks fine at present because there is still clear momentum driving consumer demand, but [European] government demand for solar energy products has declined because of reduced budgets,” Yang told the Central News Agency in a recent telephone interview.

Yang said some European countries, such as Spain, Italy and Germany, have cut their subsidies for the installation of solar equipment, shrinking the market for vendors.

“Given that the global solar panel market is forecast to be flat or to grow only slightly this year, we think there will be increased pressure [on Taiwanese suppliers],” he said.

Furthermore, because of the importance of western Europe as a market for Taiwanese exports, market uncertainties in that region could effect Taiwan’s economy.

According to the institute, the nation’s exports to western Europe accounted for 27 percent to 29 percent of its total exports, with about a third shipped directly to the region and the remaining two-thirds shipped via China.

Western Europe also accounted for 28 percent of the global smart terminal device market by value last year, the institute said, so any volatility in demand could hurt exports by Taiwanese brands, such as Acer Inc (宏碁), Asustek Computer Inc (華碩電腦) and HTC Corp (宏達電).

Yang forecast that the sales value of smart devices in Germany, France and the UK would decrease by 10 percent this year because of the eurozone debt crisis, while those in Spain, Italy and Greece would decline by 30 percent.

For the western European market as a whole, smartphone sales are expected to rise 10 percent after hitting US$43 billion last year, while notebook sales would likely remain close to last year’s US$36 billion.

Lin Chien-fu (林建甫), head of the National Policy Foundation and an economics professor at National Taiwan University, recently said that Taiwan had only negligible exposure to European debt.

However, he feared the country would still be hurt by the region’s debt problems if they led to falling demand for Taiwanese exports, especially information and communication technology products.

The Directorate General of Budget, Accounting and Statistics has trimmed the nation’s growth forecast for this year to 3.91 percent, down from the 4.19 percent forecast in November last year.